Core Viewpoint - The main theme in the capital market since the beginning of 2026 has been "price increases," which has permeated various industries and become a focal point for market transactions [10] Group 1: Market Performance - The A-share market showed divergence today, with the Shanghai Composite Index rising by 0.39% in the afternoon, while the ChiNext Index fell by over 1% [1] - The total trading volume in the Shanghai and Shenzhen markets was 2.51 trillion yuan, slightly lower than the previous trading day [1] Group 2: Price Increase Trends - Since the beginning of the year, 25 out of the top 30 concept indices have been related to the "price increase" logic, indicating a broadening trend across various sectors including oil and gas, chemicals, construction materials, and technology [10] - The "price increase" is expected to be a core factor driving market style diffusion throughout the year, reflecting industry prosperity [10] Group 3: Steel Sector Insights - The steel ETF has shown strong performance, with a cumulative increase of 10.64% this week, driven by both supply and demand catalysts [13] - Demand-side factors include favorable real estate policies in key cities, while supply-side factors indicate a contraction in 2026, leading to an accelerated phase of industry consolidation [13][14] - The steel sector is currently viewed as a bottoming area with significant elasticity potential, as low inventory levels could lead to price increases if demand catalyzes [14] Group 4: Rare Metals Surge - Rare metals such as tungsten and rare earths have seen a collective surge, with several stocks hitting historical highs, driven by four main factors [5][6] - The first factor is a dramatic increase in spot prices, with tungsten prices reaching 1.0225 million yuan per ton, up 3.7 times from the previous year [6] - The second factor is a tightening supply side, with mining quotas and environmental regulations limiting production capacity [6] - The third factor is the explosive demand from emerging industries, particularly in sectors like photovoltaics and semiconductors [6] - The fourth factor involves a global reassessment of critical mineral strategies, which has added a "safety premium" to these commodities [7] Group 5: Coal Sector Developments - The coal ETF rose by 2.82% today, influenced by production halts during the Spring Festival and ongoing reductions in Indonesian coal output [18] - The coal market is expected to benefit from policies aimed at reducing production capacity, with potential upward price elasticity if market conditions exceed expectations [19] - The coal sector is viewed as having room for a rebound, especially as other commodities have seen significant price increases [19]

Group 1 - The steel sector is experiencing positive momentum driven by supply-demand dynamics and policy support, with the steel ETF (515210) rising over 2.4% on February 27 [1] - From the industry perspective, after more than four years of a downturn, this year's winter storage accumulation is the weakest in recent years, leading to a low inventory that alleviates post-holiday destocking pressure, establishing a weak balance in supply and demand [1] - The central economic work conference has emphasized the need to address "involution" in competition, which is expected to accelerate the exit of outdated production capacity [1] Group 2 - On the cost side, the commissioning of iron ore projects like Ximangdu is expected to lead to a significant increase in new production capacity for iron and coke by 2026, while port iron ore inventories have reached a historical high of 169 million tons, allowing for cost advantages that could enhance profitability for finished steel [1] - Demand is projected to shift significantly by 2025, with manufacturing steel usage surpassing that of the construction industry for the first time, driven by emerging industries such as automotive, shipbuilding, and new energy [1] - The steel sector's potential for price appreciation is supported by a combination of policy initiatives on the supply side, cost reductions, low inventory levels, and an optimized demand structure [1]

Market Overview - The Shanghai Composite Index rose by 0.39%, while the ChiNext Index fell by 1.04% [1] - The total trading volume in the Shanghai, Shenzhen, and Beijing markets was 25,055 billion yuan, a decrease of 512 billion yuan compared to the previous day [1] - Over 3,200 stocks across the three markets experienced gains [1] Sector Performance - Rare metal stocks saw a surge, with significant increases in magnesium and tungsten stocks [1] - The rare metal ETFs, including the Rare Metal ETF and Rare Earth ETF, reported gains of 4.68% and 4.11% respectively [1] - The power sector showed strength, with the Power ETF and Green Power ETF rising by 2.73% and 2.53% respectively [1] - The steel sector also performed well, with the Steel ETF increasing by 2.45% [1] Declining Sectors - The ChiNext Growth ETF and the Deep Growth ETF both fell by 2% [1] - The semiconductor sector experienced declines, with the Semiconductor Equipment ETF and the Sci-Tech Semiconductor ETF dropping by 2.16% and 2.15% respectively [1]

Group 1 - The steel sector has seen a significant increase, primarily driven by catalysts from both supply and demand sides. On the demand side, favorable real estate policies in key cities are expected to bolster demand expectations [2] - On the supply side, there is an anticipated contraction in 2026, with iron ore having room for price reductions. The industry is expected to accelerate into a phase of survival of the fittest [3] - The Ministry of Industry and Information Technology (MIIT) released the "Steel Industry Normative Conditions (2025 Edition)" on February 8, which serves as a guiding document for the steel industry. The MIIT has begun to classify and evaluate steel enterprises, promoting resource allocation towards leading companies [3] Group 2 - The current steel sector may represent a bottoming area with significant elasticity and expectation differences. After four years of decline, industry expectations are low, with winter storage accumulation being the weakest in recent years and total inventory of five major steel products at a near-low level [4] - Low inventory levels suggest that if supply and demand are catalyzed, steel prices may have upward elasticity. Recent increases in steel prices in Southeast Asia reflect some positive signals [4] - Investors are encouraged to pay attention to the only steel ETF available in the market (515210) [4]

Market Performance - The Shanghai Composite Index rose by 1.2%, while the ChiNext Index increased by 1.43% [1] - Cyclical stocks, including steel, non-ferrous metals, chemicals, and construction, showed strong performance [1] Sector Highlights - The following ETFs saw significant gains: - Rare Earth ETF by 6.64% - Rare Metals ETF by 6.50% - Steel ETF by 5.76% - Industrial Non-Ferrous ETF by 5.49% - Non-Ferrous ETF by 4.91% - Mining ETF by 4.80% - Other related ETFs also reported increases ranging from 4.13% to 4.61% [1] - The semiconductor sector also performed well, with the following ETFs rising: - Sci-Tech Semiconductor ETF by 4.03% - Semiconductor Equipment ETF by 3.69% - Sino-Korean Semiconductor ETF by 3.69% [1] Weak Performers - The artificial intelligence sector experienced declines, with several ETFs dropping over 1%, including: - Sci-Tech AI ETF by Bosera - Sci-Tech Chip Design ETF - Online Consumption ETF by ICBC - Media ETF by Huaxia - Online Consumption ETF by Southern [1] - Other ETFs related to innovation and big data also reported declines [1]

Core Viewpoint - The steel sector is experiencing a positive start in 2026, with several companies reporting strong production and sales performance in January, indicating a potential recovery in the industry [1]. Group 1: Company Performance - Yangchun New Steel achieved a production and sales rate of 101% in January and successfully expanded into the Hainan market [1]. - Wuhu Xinxing set multiple historical records, with special steel shipments reaching their best levels in recent years [1]. - Fangda Steel exceeded production targets for both steel and materials, maintaining a self-generated electricity rate of over 95% [1]. Group 2: Industry Outlook - According to Everbright Securities, the probability of a supply-side adjustment in the steel industry has increased in the short to medium term [1]. - The losses reported by steel companies in Q4 are nearing those expected in Q3 and Q4 of 2024, highlighting the necessity for adjustments [1]. - Since the beginning of 2026, tightening export policies for steel have emerged, which could impact the industry's profitability, necessitating supply-side policies to mitigate these effects [1]. Group 3: ETF Information - The Steel ETF (515210) tracks the CSI Steel Industry Index (930606), which selects listed companies from the Shanghai and Shenzhen markets involved in various steel sub-industries to reflect the overall performance of the steel sector [1].

Group 1 - The steel industry is expected to experience high-quality development, with the steel ETF (515210) rising by 2% [1] - Long-term trends indicate that increased industry concentration and promotion of high-quality development are inevitable for the future of the steel industry [1] - Environmental regulations, ultra-low emission transformations, and carbon neutrality will enhance the competitive advantages and profitability of leading companies [1] Group 2 - Demand for steel is expected to stabilize as the negative impact of the real estate sector on steel demand diminishes, with a continuous decline in the real estate sector's share of steel demand [1] - Steel demand from infrastructure and manufacturing sectors is anticipated to grow steadily, indicating a potential bottoming out of demand [1] - Approximately 60% of steel companies are currently operating at a loss, and the industry has been in a state of micro-profit for an extended period [1] Group 3 - Market-driven supply adjustments are beginning to occur, with expectations for continued supply-side contraction [1] - The overall fundamentals of the steel industry are expected to gradually improve, and if supply policies are implemented, the pace of supply contraction may accelerate [1] - The steel ETF (515210) tracks the CSI Steel Index (930606), which reflects the overall performance of listed companies in the steel industry [1]

1. Report Industry Investment Rating - Not provided in the content 2. Core Viewpoints - The report presents several ETF strategy indices constructed by Huabao Research and tracks their performance and positions on a weekly basis, aiming to help investors convert quantitative models or subjective views into practical investment strategies [11] 3. Summary by Relevant Catalog 3.1 ETF Strategy Index Tracking - **Overall Performance**: The table shows the performance of various ETF strategy indices last week. The Huabao Research Quantitative Windmill ETF Strategy Index had the highest weekly excess return of 2.56%, while the Huabao Research SmartBeta Enhanced ETF Strategy Index had the lowest weekly excess return of -2.76% [12] 3.1.1 Huabao Research Size Rotation ETF Strategy Index - **Strategy**: It uses multi - dimensional technical indicator factors and a machine - learning model to predict the return difference between the Shenwan Large - Cap Index and the Shenwan Small - Cap Index. It outputs weekly signals to predict the strength of the indices in the next week and determines positions accordingly to obtain excess returns [13] - **Performance**: As of 2026/1/30, the excess return since 2024 was 29.34%, the excess return in the past month was 5.89%, and the excess return in the past week was - 1.86%. The index's positions include 50% in the CSI 500ETF and 50% in the CSI 1000ETF [13][17] 3.1.2 Huabao Research SmartBeta Enhanced ETF Strategy Index - **Strategy**: It uses price - volume indicators to time self - built Barra factors and maps timing signals to ETFs based on their exposure to 9 major Barra factors to achieve market - outperforming returns. The selected ETFs cover mainstream broad - based index ETFs and some style and strategy ETFs [17] - **Performance**: As of 2026/1/30, the excess return since 2024 was 20.15%, the excess return in the past month was - 2.11%, and the excess return in the past week was - 2.76%. The index's positions are mainly in several science - innovation and growth - style ETFs [17] 3.1.3 Huabao Research Quantitative Windmill ETF Strategy Index - **Strategy**: It starts from a multi - factor perspective, including the grasp of medium - to - long - term fundamentals, tracking of short - term market trends, and analysis of the behavior of various market participants. It uses valuation and crowding signals to indicate industry risks and multi - dimensionally digs out potential sectors to obtain excess returns [20] - **Performance**: As of 2026/1/30, the excess return since 2024 was 51.39%, the excess return in the past month was 6.51%, and the excess return in the past week was 2.56%. The index's positions are mainly in commodity - related and financial - related ETFs [20][25] 3.1.4 Huabao Research Quantitative Balance ETF Strategy Index - **Strategy**: It adopts a multi - factor system, including economic fundamentals, liquidity, technical analysis, and investor behavior factors, to construct a quantitative timing system for trend analysis of the equity market. It also builds a prediction model for market large - and small - cap styles to adjust the equity market position distribution and obtain excess returns through comprehensive timing and rotation [24] - **Performance**: As of 2026/1/30, the excess return since 2024 was - 10.24%, the excess return in the past month was 0.48%, and the excess return in the past week was - 0.36%. The index's positions include bonds and equity - based ETFs [24][27] 3.1.5 Huabao Research Hot - Spot Tracking ETF Strategy Index - **Strategy**: It uses strategies such as market sentiment analysis, tracking of major industry events, investor sentiment and professional opinions, policy and regulatory changes, and historical analysis to track and dig out hot - spot index target products in a timely manner, constructing an ETF portfolio that can capture market hot spots and providing short - term market trend references for investors [27] - **Performance**: As of 2026/1/30, the excess return in the past month was 6.21%, and the excess return in the past week was 3.21%. The index's positions are mainly in commodity, Hong - Kong - stock, and short - term financing ETFs [27][30] 3.1.6 Huabao Research Bond ETF Duration Strategy Index - **Strategy**: It uses bond market liquidity and price - volume indicators to screen effective timing factors and predicts bond yields through machine - learning methods. When the expected yield is below a certain threshold, it reduces the long - duration positions in the bond investment portfolio to improve long - term returns and drawdown control [30] - **Performance**: As of 2026/1/30, the excess return in the past month was 0.40%, and the excess return in the past week was 0.14%. The index's positions are mainly in bond - related ETFs [30][33]

Investment Rating - The report maintains a bullish outlook on short-term bonds, balanced undervalued convertible bonds, and cautiously bullish on gold assets [1][2][3] Core Insights - The report emphasizes a multi-asset allocation strategy focusing on short-term bonds, undervalued convertible bonds, and gold assets, with a specific recommendation to hold 1-year short-duration bonds due to predicted increases in level factors and steepening of the yield curve [1][10] - The convertible bond market is currently viewed as having low relative value compared to underlying stocks, with a "100-yuan conversion premium rate" of 45.02% indicating a low cost-effectiveness for overall allocation [2][15] - The expected return for gold over the next year is projected at 30.8%, suggesting a cautious bullish stance on gold assets following significant price declines [2][22] Summary by Sections Multi-Asset Allocation Viewpoints - **Bond Duration Timing**: The model predicts an increase in level factors and a steepening yield curve, recommending the holding of 1-year short-duration bonds [10][11] - **Convertible Bond Allocation**: The "100-yuan conversion premium rate" is at 45.02%, indicating low cost-effectiveness for convertible bonds compared to underlying stocks. The median of the "adjusted YTM - credit bond YTM" is -5.36%, suggesting low relative value for debt-type convertible bonds [15][16] - **Gold Allocation**: The expected return for gold is projected at 30.8%, with a cautious bullish outlook due to recent price declines [22][23] Stock and Bond Allocation - The report is bullish on equity assets, with the latest equity position at 25%. The stock-bond rotation strategy has yielded a return of 1.23% in January, with the latest equity position at 24.66% [25][32] Industry Rotation - The report is bullish on sectors including steel, building materials, media, chemicals, telecommunications, and textiles. It recommends a growth style over value style, with a focus on cyclical and technology sectors [4][41] - The latest industry rotation signals indicate a preference for cyclical and technology sectors, with a strong recommendation for growth style investments [41][42] ETF Rotation Portfolio - The ETF rotation portfolio includes holdings in chemical, gaming, building materials, and steel ETFs, with a recent performance showing an excess return of 3.2% compared to the average industry return [49][52]

Group 1 - The steel ETF (515210) has seen a net inflow of nearly 400 million yuan over the past four days, indicating a potential value recovery in the industry [1] - The supply disruptions in the steel sector are intensifying, with safety incidents at Baogang prompting safety inspections across steel mills, which may lead to temporary production cuts [1] - The Tangshan Emergency Management Bureau has initiated a city-wide safety inspection for steel enterprises, which could slightly reduce local production capacity, providing cost and supply support [1] Group 2 - Current profits for ordinary steel (普钢) are substantial, and in the context of the industry's "anti-involution," there is significant room for performance improvement among ordinary steel companies, suggesting a potential value recovery [1] - The steel ETF (515210) tracks the CSI Steel Index (930606), which selects securities from listed companies in the steel industry to reflect the overall performance of the sector [1] - The index includes various sub-sectors such as ordinary steel and special steel, capturing the overall market dynamics of the steel industry, which exhibits notable cyclical characteristics [1]